If you have a property in Spain but you are not a resident, you should take into account the payment of Non-Resident Income Tax. This tax must be filed through Model 210. Bureaucracy is not the easiest thing in the world, so we help you learn more about this tax and how it affects you.
Because sometimes the good life also comes with paperwork.
Who has to file Model 210?
You will have to file the Non-Resident Income Tax in Spain if you do not reside in Spanish territory but receive income of Spanish origin, provided that it has not been subject to prior withholding in Spain. Watch out! As with everything else, there are exceptions. You do have to file Model 210 even if your income has been subject to prior withholding in Spain for:
- Capital gains from the transfer of real estate properties located in Spanish territory.
- Capital gains from reimbursement of Spanish investment funds when withholding is less than the amount of tax due.
You also have to file Model 210 to request a refund of the excess withholding tax in Spain, provided that you are a resident of a country with a double taxation agreement with Spain.
Am I a resident in Spain or not?
Sometimes it is difficult to be sure whether you are a resident or not, especially if you spend long periods of time living in Spain. You have to be very careful, because if your situation is not normalized, you may experience unpleasant surprises.
You are considered a resident in Spain if:
- You stay in Spain more than 183 days a year.
- The base of your economic or professional activities is in Spain.
- You are a civil servant of Spanish nationality who has been posted abroad because of your job or position, together with your spouse and minor children.
If your case is none of the above, you are considered a NON-RESIDENT and, therefore, will be subject to Non-Resident Income Tax (IRNR).
How much do I have to pay?
The payment of Non-Resident Income Tax varies depending on whether the property you own is rented out -and therefore you receive a benefit from it- or not.
- If you plan to rent the property, you must declare the income you receive from this activity and pay tax on this gain through Model 210. The tax varies according to the circumstances. In many cases, you simply pay a tax of 25% of the income from renting the property.
- If you are not planning to rent it out, the tax is paid according to the value of the property (25% of 2% of the cadastral value).
If you are a foreigner but resident in Spain, you will pay this tax according to the income obtained during the year.
It can be somewhat confusing, but do not worry, at Sonneil we make it easy for you to enjoy your home in Spain without any headaches. That is why we offer our customers tax advice.